Nigeria Striking a Delicate Balance

As diplomats and VIPs assembled at Lagos' Tafawa Balewa Square for Nigeria's 25th Independence Day celebrations last October, a sudden downpour sent many notables scrambling for cover under the grandstand. Within moments, ordinary Nigerians in the bleachers were soaking wet. So was a bullish army officer striding across the parade grounds. Spurning an aide's offer of an umbrella, Major General Ibrahim Badamasi Babangida, 44, continued to inspect a military honor guard in the rain. The crowd roared its approval and gave a standing ovation to the new President of Africa's most populous nation.

That common touch has served Babangida well since last Aug. 27, when he came to power in a military coup. Babangida deposed the country's former military leader, Major General Mohammed Buhari, who himself had overthrown the government of President Shehu Shagari in a 1983 New Year's Eve coup. Buhari had alienated the country of some 95 million people with his repressive tactics, which included jailing political enemies and using military tribunals instead of civil courts to dispense justice. Babangida's bloodless, well- planned takeover was the fifth in Nigeria since it gained independence from Britain in 1960, and the third time in ten years that Babangida played a vital role in shaping a new leadership. This time, instead of turning over the government to someone else and returning to the barracks, Babangida seized power himself, declaring his intention to run "an open administration that is responsive to the yearnings and aspirations of all the people."

For the past five months the new President has tried to blend military orderliness with the freedoms of a democratic political system. So far, his resolve has withstood mounting economic pressures. Until 1980 Nigeria was flush with revenues from its oil industry, which at one time produced 2.3 million bbl. a day and yielded $23.4 billion a year in revenue. But the worldwide petroleum glut has left the country, which earns 95% of its foreign currency from oil exports, teetering on the edge of economic collapse. Last year Nigeria produced a daily average of 1.4 million bbl., earning $11.3 billion. Even if the current world price of around $16 per bbl. stabilizes at $20, some economists believe, the country's foreign-exchange reserves will dry up by late 1986.

Astonishingly, one of Babangida's first moves was to invite public debate on how to deal with Nigeria's $24 billion foreign debt. In a series of unprecedented public meetings, as well as in newspaper editorials, Nigerians resoundingly opposed the government's application for a new $2.5 billion loan from the International Monetary Fund. Although the money was badly needed to keep pace with the debt, Babangida suspended negotiations with the IMF. Instead, he shrewdly used his mandate to impose many of the draconian austerity measures that the IMF had suggested. Among them: doubling the price of gasoline and tripling the price of diesel fuel by dropping state oil subsidies, cutting wages, and allowing the naira, the national currency, to depreciate by 20% in an effort to stimulate sagging exports. "It was a courageous move in the right direction," said a U.S. official. One unfortunate side effect of the much needed program was that it set off a new round of domestic inflation.